Brown, Neri, Smith & Khan LLP Blog

On Friday, April 1, 2016, the Honorable Manuel L. Real of the United State District Court for the Central District of California, granted our client’s ex parte application for a temporary restraining order against the defendants.

Our client, ReachLocal, Inc., caught wind of spurious internet postings and communications made on Defendant PPC Claim Limited’s website and by Defendant Kieran Cassidy. Cassidy claimed that ReachLocal was misleading its clients and that he obtained ReachLocal’s entire current and former client list and would be contacting them in the future. After the communications and postings continued, ReachLocal filed suit (C.D. Cal. 2:16-cv-01007) and applied for a temporary restraining order to prevent further communications by the Defendants. In one of his last communications to ReachLocal’s CEO, Defendant Cassidy stated that he would be willing to come to an “agreement/arrangement” with ReachLocal, in order to (effectively) go away. However, in his communications to ReachLocal clients, Cassidy failed to disclose his interest in a competing business - a fact significant to Judge Real in granting ReachLocal’s temporary restraining order.

Judge Real found ReachLocal to have demonstrated all elements for a preliminary injunction: (1) ReachLocal demonstrated a likelihood of success on its claim for trade secret misappropriation (among others); (2) threatened use of the customer list constituted irreparable harm; (3) in balancing the potential harms of the parties, ReachLocal's harm outweighed any the Defendants would incur by temporarily ceasing their communications; and (4) although Defendants claimed to be consumer advocates, by “engaging in this information campaign as part of a veiled competitive commercial practice[,] the desire to acquire an improper commercial advantage,” did not constitute injury to any public interest.

Judge Real granted the temporary restraining order, enjoining the Defendants from further communicating to ReachLocal clients and investors, directly, through massing mailings, email, LinkedIn, or any other website, until hearing a motion for a preliminary injunction. Judge Real set the hearing for April 11, 2016.